The ServiceMaster Company (NYSE: SVM) announced today that its Terminix business unit has agreed to acquire certain assets of Sears Termite & Pest Control, Inc. (STPC), a wholly owned subsidiary of Sears, Roebuck and Co. The purchase price and further terms of the transaction were not disclosed.
"The Sears Termite & Pest Control business will provide us a strong base of new customers and strengthen our growing and profitable Terminix business," said Jonathan Ward, president and CEO of ServiceMaster. "The acquisition will provide positive earnings in year one. Both in the short and longer term, this acquisition is consistent with our commitment to focus on creating greater shareholder value."
"The decision to exit the termite and pest control business reflects Sears heightened focus on our core businesses," said Michael J. Tower, Sears senior vice president of strategy, and the person to whom the business reports. "It is imperative that we discontinue activities that divert attention from that task, so we can deploy resources more effectively to enhance overall company profitability."
Albert Cantu, president of Terminix, said, "The Sears name is synonymous with quality and a heralded commitment to customer service. We intend to augment the customer relationships Sears has developed through the same industry-leading service offerings and guarantees that have helped to make Terminix the world leader in termite and pest control. The Sears Termite & Pest Control business will enhance our business in the markets being acquired, especially in the states of Florida, Georgia and Texas, where both Terminix and Sears have a strong presence."
The transaction, which is expected to occur by the fourth quarter of 2001, already has received regulatory approval under the Hart-Scott-Rodino Act and is subject to customary closing conditions.
With headquarters in Orlando, Fla., STPC provides pest control services and protection against termite damage to approximately 250,000 residential customers located primarily in the Southeast. The unit has 95 locations, two customer service call centers and three franchisees. Sears, Roebuck and Co. announced earlier this year that it planned to evaluate strategic options for Sears Termite & Pest Control. The transaction is not expected to be material to the results of operations for Sears. It is anticipated that approximately 1,000 STPC employees will be affected by the acquisition at the time of the closing.
Terminix, the nation's largest termite and pest control company, serves 4 million customers through more than 325 branch locations and over 150 franchise locations in the United States, and in over 400 international locations.
ServiceMaster provides outsourcing services to more than 12 million customers in the United States and in 40 countries around the world, with customer level revenue of $7.6 billion. The core service capabilities of the Company include lawn care and landscaping, termite and pest control, plumbing, heating and air conditioning maintenance and repair, cleaning, plant maintenance and supportive management.
These services are provided through a network of over 5,800 company-owned and franchised service centers and business units, operating under leading brands which include TruGreen ChemLawn, TruGreen LandCare, Terminix, American Home Shield, American Mechanical Services, Rescue Rooter, American Residential Services, ServiceMaster Clean, Merry Maids, AmeriSpec, Furniture Medic, ServiceMaster Home Service Center and ServiceMaster Management Services. Sears, Roebuck and Co. is a leading U.S. retailer of apparel, home and automotive products and services, with annual revenue of more than $40 billion. The company serves families in the U.S. through Sears stores nationwide, including approximately 860 full-line stores. Sears also offers a wide variety of merchandise and services through its Web site, http://www.sears.com/ .
This release includes forward-looking statements relating to the closing, post-transaction operations and earnings effects. Actual results may differ materially from those projected. Factors that could cause them to differ materially include the need to satisfy conditions to closing, the ability of Terminix to integrate the acquired assets, the level of future customer warranty claims, as well as any related indemnification obligations, consumer reaction to the transaction and normal business uncertainty. The parties do not undertake to update any forward-looking statements.
SOURCE: Sears, Roebuck & Co.
Contact: Ted McDougal of Sears, +1-847-286-9669